How to File Form 990-EZ Electronically
Our guide helps small non-profits understand the complete electronic filing process for Form 990-EZ, ensuring an accurate and compliant annual return.
Form 990-EZ is the annual information return filed with the Internal Revenue Service (IRS) by smaller tax-exempt organizations. This return demonstrates that the organization is meeting the requirements to maintain its tax-exempt status and provides financial transparency to the public, making its activities and finances a matter of public record.
Determining Eligibility to File Form 990-EZ
An organization’s eligibility to file Form 990-EZ depends on financial thresholds set by the IRS. To qualify, a nonprofit must have gross receipts of less than $200,000 during its fiscal year and total assets valued at less than $500,000 at the end of that year. Exceeding either threshold requires the organization to file the more comprehensive Form 990 instead.
“Gross receipts” are the total amounts an organization received from all sources during its accounting period, without subtracting costs or expenses. “Total assets” is the book value of everything the organization owns at the fiscal year’s end, including cash, investments, and equipment. Organizations with gross receipts of $50,000 or less may be able to file the simpler Form 990-N, also known as the e-Postcard.
Information and Documents Needed for Filing
Before beginning the electronic filing process, you must gather several key pieces of information and documentation:
- Basic Identifying Information: The organization’s legal name, mailing address, Employer Identification Number (EIN), and the specific fiscal year dates for the return.
- Financial Data: A summary of total revenue broken down by source, and total expenses categorized by function such as program services, management, and fundraising. You will also need the value of total assets and total liabilities at both the beginning and end of the tax year.
- Leadership Information: A complete list of all individuals who served as officers, directors, trustees, and key employees during the reporting year, including their name, title, and any reportable compensation.
- Program Accomplishments: A narrative description of the organization’s key activities and achievements that further the organization’s exempt purpose during the year.
- Supplemental Schedules: Certain activities require schedules to be filed with the Form 990-EZ. These can include Schedule A for public support details, Schedule B for major contributors, or Schedule O for supplemental explanations.
The Electronic Filing Process
The IRS mandates that all Forms 990-EZ must be filed electronically. The first step is to select an IRS-approved e-file provider from the list available on the IRS website. These providers offer software to guide organizations through the preparation and submission of their return.
After creating an account with a chosen provider, you will navigate the software to begin the Form 990-EZ. The process involves entering the previously gathered information, including financial data, the list of officers and their compensation, and the narrative descriptions of program accomplishments.
Once all data entry is complete, the provider’s software will generate a PDF version of the completed Form 990-EZ for review. It is important to carefully check this document for any errors or omissions. The final steps involve electronically signing the return, which requires creating a personal identification number (PIN), and then transmitting the completed form to the IRS. You should receive a confirmation from the provider, followed by a second notification within a couple of days confirming IRS acceptance or rejection.
Post-Filing Requirements and Considerations
After the IRS accepts the electronically filed Form 990-EZ, the return becomes a public document. The IRS makes these filings available for public inspection through its Tax Exempt Organization Search tool, allowing anyone to view the organization’s financial data and operational details.
Filing with the IRS does not necessarily satisfy all state-level reporting obligations. Many states have their own registration and annual reporting requirements for nonprofits operating or soliciting donations within their borders. The organization must identify and comply with any separate filing duties required by the states in which it is active.
Finally, maintaining thorough records is important. The organization must keep a complete copy of its filed Form 990-EZ and all attachments. While the return must be available for public inspection for three years, the underlying financial records supporting the return should be kept longer, as the IRS may conduct an audit for up to six years after filing. Foundational documents, such as the organization’s application for tax-exempt status and its governing documents, should be kept permanently.